Quote on Weekly Market Outlook for the coming week, and technical views from Mr. Ajit Mishra, SVP - Research, Religare Broking
Below the Quote on Weekly Market Outlook for the coming week, and technical views from Mr. Ajit Mishra, SVP – Research, Religare Broking
Markets Rebound as Earnings Optimism Lifts Benchmarks; Mid- and Small-Caps Outperform
Market Summary
Markets staged a recovery during the week, supported by encouraging corporate earnings and renewed buying interest in heavyweight stocks.
The benchmarks began the week on a positive note, followed by two sessions of consolidation and mild weakness. Sentiment improved sharply on Thursday, when the Sensex surged over 900 points, with buying momentum extending into Friday. The recovery helped the Nifty reclaim the 23,000 mark, signalling an improvement in near-term market sentiment.
Consequently, the Sensex gained 1.83% to close at 74,459.53, while the Nifty advanced 2% to settle at 23,053.10.
Key Market Drivers
Domestic market sentiment remained focused on the September-quarter earnings season. Strong performances from select large companies supported sentiment, although mixed results across sectors led to pronounced stock-specific reactions.
Global cues remained mixed. The US Federal Reserve kept its target interest rate unchanged at 3.75%–4.00%, although two members favoured a 25-basis-point hike, highlighting differences in policy views. Geopolitical uncertainty in West Asia also remained a key concern, keeping crude oil prices elevated amid fears of potential supply disruptions and risks to critical shipping routes.
Key Events to Watch
Markets will remain focused on the September-quarter earnings season, key economic data releases and global developments in the coming week. Investors will assess corporate performance for signs of sustained revenue growth, margin resilience and improving demand. Banking results will offer insights into credit growth, deposit mobilisation and asset quality, while automobile, consumer and industrial companies will provide a broader assessment of domestic demand conditions.
Crude oil prices will remain an important variable, with elevated levels amid geopolitical uncertainty posing risks to imported inflation, the rupee and corporate margins. Movements in US Treasury yields, foreign institutional investor flows and currency markets will also influence near-term sentiment and the sustainability of the recent recovery.
Technical Outlook
Nifty
The Nifty has regained momentum after recovering above the 23,000 mark, improving its near-term technical outlook. The index is expected to find support in the 22,400–22,800 zone, while immediate resistance is placed at 23,200–23,500. A decisive breakout above 23,500 could strengthen upward momentum and open the possibility of further gains. However, failure to sustain above 23,200 may lead to consolidation, with the support zone remaining crucial for maintaining the recovery.
Bank Nifty
Bank Nifty is likely to remain volatile, with the 52,700–53,800 zone acting as an important support area. On the upside, the index faces resistance in the 55,600–56,300 range. A sustained move above 56,300 could signal improving momentum and strengthen the recovery, while failure to overcome this resistance zone may keep the index range-bound. Holding the support zone will be important for preserving the near-term positive bias.
Broader Indices
Mid- and small-cap stocks outperformed the benchmark indices, gaining 2.69% and 4.08%, respectively. This stronger performance indicates an improvement in risk appetite and broader market participation during the recovery. However, the sustainability of this outperformance will depend on earnings delivery, valuations and continued institutional buying.
Strategy Ahead
The near-term market outlook remains cautiously positive, supported by improving price momentum and broader-market participation. However, a decisive move above 23,200 will be crucial for sustaining the Nifty’s recovery and strengthening the broader market trend. Investors should remain selective, prioritising companies with resilient earnings, healthy balance sheets and sustainable growth prospects, while avoiding excessive leverage amid persistent domestic and global uncertainties.
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